Business Briefs: The Pay Transparency Trap, Voice Data and Your Mood & Internal Crisis Communications

Welcome to Business Briefs! The world of academic publications features fascinating findings from real-world experiments in business and the marketplace. Here are some key takeaways and applicable nuggets of knowledge that may be helpful for your business.

The Downside of Pay Transparency

In principle, being transparent is good. You want to be straightforward and honest, and you want to work with others who have the same values. 

And so, it seems like pay transparency would be a good thing. It would help promote objectivity regarding raises, and fairness and accountability. Sounds great. 

But according to researchers, there are also some consequences of all this transparency that suggest it can build a toxic workplace. 

Researchers conducted a couple studies to learn how employees react when compensation becomes more transparent. Part of the data set is based on a survey of 218 participants. The survey had an interesting feature: It included attention checks, to make sure that the participants were actually reading the survey, and not just filling in boxes randomly. 80% of the participants were between the ages of 20 and 40, and 43% were women. 

In general, before pay transparency, employees infer their pay standing based on their sense of relative performance. When participants were shown (fictional) aggregated pay information about coworker salaries, those who found that their expectations of their standing were unmet, experienced envy and decreased job satisfaction. 

In plainer language, it’s this: If you think you’re a good contributor at a business, and you find out that your pay is really just average or even below average, that revelation damages your feelings about your workplace. 

That’s not to say that transparency is bad. But for businesses that are considering a change to more pay transparency, it’s good to invest a little time in advance, communicating exactly how pay is determined. 

Read more here

The Shift to Pay Transparency: Undermet Pay Standing Expectations and Consequences – Kathrin Schnaufer, Fabian Christandl, Sebastian Berger, Timo Meynhardt,  & Mario Gollwitzer, Journal of Organizational Behavior

Sharing Data with Your Voice

We know online retailers are watching us. You start a search for new car, for example, and advertisements for auto dealers suddenly start appearing everywhere online. 

The advent of voice shopping promises to give retailers a whole new slew of data about us, including our mood. While it may be a little hard to assess shopping mood from the words you type in a search engine, when you use your voice and audio commands…that’s a different story. 

Here’s how it works. Researchers started with 1,007 subjects. Subjects were asked about their mood, and then about half were asked to speak quotation commands like “Next product please.” The other half were asked to choose their own words to speak, so they had prompts such as “Ask for the next product.” This process provided two types of data: The ability to match mood to tone (in the scripted version) and the ability to match mood to word choice (in the unscripted version). 

The first thing researchers learned is that they could accurately predict mood through voice. 

Although prior research indicates that a good mood is associated with more spending in the offline shopping arena, that’s not quite what the team was after. They were actually more interested in learning the best way technology can adapt to shopper mood. 

What they found was that people in good moods should probably be auto-fed more audio information about a product before purchase. It helps them make better decisions (without buyer remorse). On the other hand, voice shoppers in a bad mood should be able to ask for more information in online shopping – but not be force fed it (because force-feeding just makes them more frustrated). 

Read more here

How Voice Retailers can Predict Customer Mood and how they can use that Information – Ingo Halbauer &  Martin Klarmann, International Journal of Research in Marketing

Internal Communications in a Time of Crisis

When you think about a businesses crisis communication, you usually think about external communications; how a business leader might assure potential customers.  

But internal crisis communication is important too. If an organization messes up, the employees need to hear from leadership as well. 

Researchers wanted to know the sorts of messages were helpful to employees when coping with a crisis. So, they surveyed 490 full-time employees in the U.S. at a variety of income, age, and education levels. Employees were asked questions about whether their manager provided them with support such as “helpful information” or “encouragement,” along with questions about how connected those employees felt to the company. 

To create strong coping and engagement sensibilities in employees, the researchers had three ultimate suggestions:

  • A leader should issue clear instructions. Clearly articulate work expectations in a transparent way, and use lots of channels to communicate those expectations: meetings emails, phone. (This was called “Direction-Giving” in the study.)
  • A leader should also display empathy and caring. Adopt a “We are in this together” attitude that includes recognition of individuals worries as well as achievements
  • Finally, a leader should express organizational goals in ways that are aligned with employee personal goals and engagement. 

Read more here

Enhancing Employee Engagement via Leaders’ Motivational Language in Times of Crisis: Perspectives from the COVID-19 Outbreak – Weiting Tao, Yeunjae Lee, Ruoyu Sun, Jo-Yun Li & Mu He, Public Relations Review